WASHINGTON -- A newly re-elected President Obama reached out to
congressional leaders in search of cooperation Wednesday as Democrats
and Republicans moved from a cliffhanger election to a "fiscal cliff."

Other than House Speaker John Boehner's purple tie, the appetite for compromise appeared more rhetorical than realistic.

Thanks
to an electorate that gave Obama, House Republicans and Senate
Democrats a new lease on strife, the same leaders who failed last year
to strike a deal on raising taxes, cutting spending and reducing the
budget deficit found themselves stuck with each other through 2014.

Financial
markets were not impressed. The Dow Jones industrial average dropped
more than 300 points, the biggest decline in a year. Continuing
economic problems in Europe didn't help.

The two sides wasted no
time staking out their positions on the potential crisis that is 54 days
away: the expiration of almost every tax cut enacted since 2001, which
could raise the average U.S. household's tax burden by $3,500, and the
first $110 billion of $1.2 trillion in spending cuts set to occur over
10 years.

"The president said he believed that the American people sent a
message in yesterday's election that leaders in both parties need to put
aside their partisan interests and work with common purpose," the White
House said in a statement.

Hours earlier, however, Obama told
ecstatic supporters in Chicago that progress on the nation's fiscal
problems won't come easy. "We will disagree, sometimes fiercely, about
how we get there," he said.

If there was any doubt about that,
Boehner ended it with his own call for cooperation. After
congratulating Obama on his victory, he said Republicans would refuse to
raise tax rates, as the president has sought for those earning more
than $250,000. Instead, he proposed raising revenue by overhauling the
tax code.

"Mr. President, this is your moment," Boehner said. "Let's challenge ourselves to find the common ground that has eluded us."

Senate
Democratic leader Harry Reid also offered an olive branch but staked
out his party's position - that voters delivered a mandate for higher
taxes on the rich. "I'm going to do everything within my power to be as
conciliatory as possible," Reid said. "But I want everyone to also
understand you can't push us around."

Reid's reading of the
electorate differed considerably from Senate GOP leader Mitch
McConnell's take: "The voters have not endorsed the failures or excesses
of the president's first term," he said. "They have simply given him
more time to finish the job."

Outside experts said the two sides
have little choice but to compromise. Douglas Holtz-Eakin, former
director of the Congressional Budget Office, said voters re-elected "the
same cast of characters, but we need the movie to have a different
ending ... Getting to 2013 without blowing up the economy is the top
priority."